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Tuesday, October 11, 2011

Sorry....Don't Believe It

“First, to talk about households in general as overleveraged and pinned up against credit constraints is to seriously exaggerate: some are, but many are not. In the aggregate, the assets of American households are still far higher than their liabilities—in fact, as a quick glance at the Federal Reserve Flow of Funds tables will demonstrate, the situation isn’t so much worse than it was pre-crash:

Bad? Of course. But just as in 2006, most of America’s wealth is held by households whose assets vastly exceed their liabilities.”